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Alternative methods to resolve intellectual property disputes

From: Canadian Intellectual Property Office

Alternative dispute resolution (ADR) means solving disputes outside the courts. Unlike litigation, which will have a binary outcome (win or lose), parties can use ADR to tailor the outcome and the dispute resolution process.

ADR includes negotiation, mediation and arbitration. It allows parties to combine these methods and tailor the rules to fit their needs.

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Benefits of ADR

ADR methods offer many potential advantages:

ADR could resolve a multi-jurisdictional (across provinces, countries) matter with a single process, thereby avoiding multiple lawsuits that often result in contrasting outcomes.

Those benefits explain why ADR is often chosen over traditional litigation.

ADR methods require the consent of both parties. Quite often, businesses enter into agreements that mandate the resolution of possible disputes through ADR methods, for reasons of confidentiality and cost control.

Parties in a legal dispute have the option to pursue ADR methods in a parallel process, upon consent by all parties. This way, parties can resolve their differences even during litigation.

Types of ADR

ADR provides a variety of ways to resolve your dispute. Even if litigation is already in progress, it is never too late to turn to ADR for a custom-tailored solution, as ADR can be pursued as a parallel process.

Negotiation

Negotiation is often the first approach taken to resolving an intellectual property (IP) dispute. The parties or their counsel hold discussions in the hope of reaching a mutually satisfactory agreement. A negotiated agreement can become a contract enforceable by the courts.

Mediation

Mediation is process where an impartial third party mediator assists the parties in reaching a resolution by facilitating communication between them. Mediators often highlight the parties' needs and interests and help overcome impasses.

Unlike a judge or an arbitrator, the mediator does not decide who is right or wrong. Instead, the mediator provides insights and helps parties resolve the conflict through collaboration. Then, the parties can craft their own solution to the conflict rather than giving up decision-making control to a third party, such as a judge. In this way, mediation can reduce the uncertainty inherent in an adjudicated outcome.

The mediator is normally chosen by the parties themselves. The parties can select a mediator who is knowledgeable in the subject matter. This may help parties solve the dispute without other subject matter experts who would need to provide evidence to a court concerning the technology, for example.

Mediation can also result in the parties agreeing to cross-licenses and royalty rates, or other arrangements that may not be available if the case is decided by a court.

A mediated agreement in the context of a court dispute may be approved by the court. This gives the agreement the same force and effect as a court decision.

Generally, the parties share the mediator's fees. Some jurisdictions provide mediation or conciliation services free of charge. The Federal Court may, in some cases, provide the parties with a mediator.

To summarize, mediation is a confidential process. It offers many benefits, including the following:

However, if infringement is the issue, mediation does not send a public message to deter other infringers.

Arbitration

Arbitration is a voluntary approach to dispute resolution that involves an arbitrator. The arbitrator is an impartial third party chosen by the parties themselves. The arbitrator hears both parties and their witnesses in the manner of a trial and provides a decision based on the evidence presented by each party and the applicable law.

Arbitration is a more formal method of dispute resolution than mediation. It is simpler and faster than litigation. The arbitrator's final decision is both determinative and legally binding. It may be approved by a court, which makes it binding in the same way as a civil judgment.

Arbitrations are intended to lead to finality. The options to see an appeal or judicial review of an arbitral decision are limited.

Note: Arbitrators do not have to comply with strict procedural and evidentiary rules.

The benefits of arbitration include the following:

Choosing between mediation and arbitration

The choice between arbitration and mediation depends on your situation and most pressing issues.

Your case involves problems in multiple jurisdictions or involves multiple types of IP.

Mediation

Arbitration

You are a busy person or time is of the essence. It is important for you to try to resolve the dispute in accordance with a timeline you control.

Mediation

Arbitration

You like flexibility and the opportunity to be creative in solving your problem.

Mediation

Arbitration

You are concerned with costs.

Mediation

Arbitration

The thought of a public litigation and of a trial causes you stress and anxiety.

Mediation

Arbitration

You are interested in preserving or expanding business relations with the opponent in the dispute.

Mediation

Arbitration

Confidentiality is important to you.

Mediation

Arbitration

You want to settle a strict legal issue or you need a ruling to send a clear message.

Mediation

Arbitration

Get professional help

Solving conflicts involving IP rights is often complex. Consult an IP professional, such as an IP agent or lawyer, to discuss the next steps if you believe your IP rights are being infringed upon.

If IP infringement is happening in another country, a Canadian IP professional may be able to coordinate with an IP professional in the other country to enforce your IP rights.

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